Blair urges world trade deal

Tony Blair last night warned that if trade negotiators meeting in Davos tomorrow fail to get stricken world trade talks back on track, the results would be "catastrophic".

The Prime Minister, who is attending the World Economic Forum in the Swiss mountain town, said the consequences of failure would be "far worse than many politicians actually realise" and volunteered, together with his likely successor Gordon Brown, to hold a meeting of heads of state to clinch a deal.

His warning came as key trade ministers prepared for an official meeting tomorrow which, it is hoped, will reignite the negotiations, which broke down last summer. Negotiators from the developing world said the United States now needed to make the next move, or witness the round's failure.

Mr Blair said: "There is no stamp of reason why we cannot get a deal done. There is every chance this will get underway again. If we succeed it will be great. If it fails, it will be catastrophic.

"I've spoken to Lula [da Silva, president of Brazil] about this and I'm perfectly happy to do this at leaders' level as long as we are not alone at the table."

His comments came only hours after the Chancellor, Gordon Brown, pledged to call a summit of presidents and state leaders from around the world to push through the trade talks – aimed at cutting tariffs and subsidies which distort world commerce.

The Doha Round of talks, which began in the Qatari capital in 2001, broke down last summer, as rich and poor nations reached a stalemate in their negotiations.

The talks are intended both to increase global growth dramatically and cut world poverty, however, poor countries have argued that developed nations should make extra cuts in their trade support to compensate for their wealth. With the US administration's fast-track negotiation ability due to expire this summer, there are, realistically, only a matter of months left in order to seal a deal.

Mr Brown said the negotiations by the trade delegates, including European Trade Commissioner Peter Mandelson, might need a push from heads of state.

"You might have to consider a heads of government meeting to complete the deal. At this point it might be necessary.

"There is a view that if it's necessary to have it, it should happen. Now we have to make sure that the trade negotiations go further."

However, Kamal Nath, India's commerce minister and one of the "Group of Four" core negotiating partners, played down the expectations many commentators have that a deal will be struck in tomorrow's session.

"It's much too early to talk about completion," he said. "On Saturday morning we can only lay out the process. Because at the moment it's still an impasse.

"In the end this process is about how much the appropriate countries are willing to respect the livelihood and commerce of the developing countries, and half a billion farmers.

"We are happy with the concessions made by Peter Mandelson. Now the US has to make its move."